On this day in economic and financial history ...

On Nov. 24, 1949, Great Britain's Labour-led government took one of the boldest strides into a socialized economy of any Western nation in peacetime. The House of Lords passed the contentiously debated Iron and Steel Act, and it became law minutes later with the king's signature. One and a half years later, the act came into force, nationalizing 80 of Britain's largest iron and steel companies as the Iron and Steel Corporation of Great Britain. This nationalization effort avoided the quagmire of extracting iron and steel operations from diversified corporations by simply nationalizing ownership of the entire company.

The British adopted differing attitudes toward nationalized industry depending on which party took power. The Iron and Steel Corporation was broken up when the Conservatives returned to power. However, in 1967, Labour again nationalized the steel industry with the British Steel Corporation. This eventually became a private, publicly traded company in 1988, and it later merged with a Dutch steelmaker with a name full of vowels very close to each other. Today, the former British Steel Corporation is a subsidiary of the Indian conglomerate Tata. The historical ironies of a conglomerate from the former crown jewel of British colonial power that acquires a large chunk of British industrial power shouldn't be overlooked.

Britain's example may have been on President Harry Truman's mind when he issued Executive Order 10340, a blandly named pronouncement with far-reaching implications, in early 1952  This order came in response to a feared steelworker's strike as the Korean War was just getting into gear, nationalizing 71 of the country's major steel producers with the stroke of a pen.

Two members of the 1952 Dow Jones Industrial Average (DJINDICES:^DJI)  -- Bethlehem Steel, the assets of which are now part of ArcelorMittal (NYSE:MT), and U.S. Steel (NYSE:X) -- fell under the scope of the order. Truman's order soon came under fire from steel executives, who sued all the way to the Supreme Court. The court's justices struck down the order by a 6-3 decision a month after its creation, ruling that Truman had acted beyond the scope of his powers. Had Congress supported the order, things would have been much different, but legislative inaction was all the support private enterprise needed. The Constitution handled the rest.

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